Category: Business, Economics and Finance / Consumer Finance / Law, Crime and Justice / Fraud and Corporate Crime

'Homeless, elderly' people signed up as company directors in alleged tax scam

Monday, 17 Oct 2016 15:10:02 | Dan Oakes And Sam Clark

A man under investigation by federal authorities over allegations he helped struggling companies avoid paying tax on more than $20 million of income was previously accused of defrauding property investors of millions of dollars.

Key points:

  • Former clients say they were unwittingly signed up as directors of companies
  • The ordeal has left one man living out of his car
  • Philip Whiteman was previously sued six years ago by investors

Philip Whiteman has also been accused by a former client and an employee of orchestrating the installation of people as the directors of companies without their knowledge, in order to allow business owners to avoid their creditors.

Investigators from the Australian Tax Office (ATO), the Australian Securities and Investment Commission (ASIC) and the Federal Police raided an office in the inner-Melbourne suburb of Cremorne early in August.

In a press release, the ATO said the raids were also carried out on other properties in Queensland and Victoria.

"[The raids were part of an] ongoing investigation into the activities of a firm of pre-insolvency advisors and their involvement in encouraging and facilitating illegal phoenix activity, evading GST and failing to pay tax on $22 million of unreported income," the ATO press release said.

"Phoenix activity" involves moving assets from a struggling company to a new company, allowing the business to escape paying creditors.

The investigators left a letter at each premises they raided, authorising them to seize documents relating to a number of companies, individuals and addresses.

Among those names was that of Philip Whiteman, who 7.30 has been told also calls himself Philip White, Philip Graham and Philip Damen.

Do you know more about this story? Email investigations@abc.net.au

Former employees and clients of Mr Whiteman have told 7.30 that although he is not listed as a director, he controls a number of companies based at the Cremorne address, including those named in the ATO letter.

Former client now homeless, caught in web of debt

Also listed on the letter was Christopher Somogyi, who told 7.30 that he went to the Cremorne address last year to have his tax return done.

Mr Somogyi said a consultant from A&S Services then asked him if he would become a director of a company in return for a small monthly fee, and that there was nothing dishonest or unethical about the practice.

Some months later, Mr Somogyi began to receive penalty notices from the ATO, saying he was liable for hundreds of thousands of dollars in unpaid superannuation and tax.

When Mr Somogyi began investigating, he found he had been appointed as a director of a number of companies without his knowledge, including A&S Services and another law firm based at the Cremorne office called Bolton and Swan.

In some cases his appointment as a director had been backdated up to five years. He eventually accosted Mr Whiteman in a carpark near the office.

"That day I spoke to Whiteman he basically said to me that he would look after me and get them all out of my name, take me off that, fix it all up and help me get a house," Mr Somogyi said.

"I said 'well you've got a week' and he never came through, never spoke to me and never answered my calls."

Mr Somogyi is now living in his car as he tries to untangle the web of debts and directorships he is caught in.

'Somehow or another they're going to rip you off'

Marisa Sampieri was also named in the ATO letter after finding she had been made a director of a number of companies without her knowledge.

She first came into contact with Philip Whiteman and A&S Services after her business began to fail and she was cold-called by an A&S consultant.

Ms Sampieri paid $30,000 in fees to A&S, and Philip Whiteman eventually offered her a job cold-calling companies with credit problems.

"Phil Whiteman has a one-stop place. That's the only way I can put it. You come into there and you've got a solicitor, an accountant, the book-keeper, financing, you name it, he'll find it, a liquidator, they're all happy to assist with anything because somehow or another they're going to rip you off," Ms Sampieri said.

"When the company has to go bust, a month … or a couple of weeks before, Phil will put another director in who he thinks is homeless, someone he thinks is elderly, who has nothing to lose."

Mr Whiteman also asked Ms Sampieri to stand in as a director of some companies, assuring her there was nothing untoward.

However, she subsequently discovered she had been installed as a director of a number of other companies without her knowledge.

She is still receiving penalty notices from ASIC in relation to those companies, and her home was raided on the same day as Mr Whiteman's office.

Both Chris Somogyi and Marisa Sampieri complained to Victoria Police about Mr Whiteman, and were told by Victoria Police that "offences" may have been committed under the Corporations Act.

They were told to take their cases to ASIC.

Whiteman sued six years ago by investors

Mr Whiteman's name was first linked to alleged financial wrongdoing six years ago when it emerged that he was being sued by a number of people who invested money with him.

Melbourne couple Robert and Helen Barr estimate that they lost more than $1 million after Whiteman convinced them to invest in a number of businesses and properties, promising substantial returns.

"We had a discussion … and we said we wanted to pull out, we wanted our money, we wanted everything sold, and we wanted to, you know, cut ties, everything," Ms Barr said.

"Our books were going to another accountant, and [Mr Whiteman] said 'look, just give us another three or four months to tide us over this patch and we'll start doing everything.'

"That was just too late by then. Nothing came of it and when you start ringing them, they don't answer their phone."

The Barrs sued Whiteman for the return of the money, but were forced to drop the case after Whiteman declared himself bankrupt in 2010, leaving behind $28 million owed to creditors.

The couple, along with other investors, complained to the Victoria Police fraud squad, who spent two years investigating Mr Whiteman.

Police dropped the case. In a statement to 7.30, Victoria Police said there was "no evidence of criminal offences".

Whiteman 'unclear' of former clients' motives

Philip Whiteman would not comment when approached by 7.30 over the allegations, but this afternoon issued a statement acknowledging that he was the subject of an ATO investigation, but emphasising that he had not been charged.

"I am aware that certain parties have made allegations to the ABC however I am unclear as to their motivation, and without being aware of the context of those allegations I am unable to comment further," he said.

The ATO said it did not comment on ongoing investigations.

ASIC Commissioner John Price said the corporate regulator was trying to tackle the problem of "phoenixing", but that the pre-insolvency advisory industry was essentially unregulated.

He urged any company approached by people claiming they could help them out of financial trouble to think carefully before agreeing to anything.

Mr Price also said they if somebody believed they had been appointed as a director without their knowledge, they should contact ASIC immediately.



 

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